In June 2019, Perpetual and Apex started using Rivkin Portfolios in their Separately Managed Account (SMA) offering that gives investors the opportunity to follow our proven strategies. Rivkin runs four portfolios that are offered through the SMA platform. Each portfolio is designed for a different investor type ranging from growth to defensive. Here you can find more information on our Low Volatility Portfolio.
Portfolio Overview
Rivkin’s Low Volatility Strategy invests in ASX listed Securities and Exchange Traded Funds (ETFs), using a multi-asset approach. The strategy was inspired by Harry Browne’s Permanent Portfolio, initially designed in the US in the 1980s, with the goal of the strategy being to perform well in any economic conditions, from inflationary through to deflationary, and everything in between.
| Description |
# of Stocks
|
Investment Universe | Minimum Rec. Time Frame | Minimum Investment Amount | Standard Risk Measure |
| ASX listed Exchange Traded Funds (ETFs), multi-asset portfolio | 0-20 | Multi-asset portfolio | 1-2 years | 40,000 AUD | 5 – Medium to High |
Table 1: Summary of Low Volatility Portfolio
Investment Approach
The investment thesis that underpins the Low Volatility strategy is that to achieve reliable positive returns through all market cycles, one should allocate their investment capital equally to equities, bonds, gold, and cash; that is, 25% to each major asset class. Its strength relies on the inverse correlation between the four asset classes, meaning that economic and market conditions that provide a tailwind for one will be a headwind for others and vice versa.
We adapted this research for an Australian audience by selecting ASX listed ETFs while adhering to the original asset allocation. One difference is that 50% of the Low Volatility portfolio is denominated in US dollar-based assets, equities, and gold. This exposure to the AUD/USD provides added defensive characteristics.
The 25% allocated to bonds is apportioned to both government and investment-grade corporate bonds, based on market factors. While with the 25% allocated to equities, the strategy splits this across three different ETFs. The S&P500, being a large diverse index in the US has a permanent holding, while the other two holdings are changes based on a relative momentum strategy, meaning the portfolio has the ability to shift to parts of the global equity market demonstrating the best performance.
Portfolio Management
The Low Volatility portfolio is re-balanced on an as-need basis, whenever one of the major four asset classes moves outside the desired band of 23% to 27%. This typically occurs three to five times per year. In addition, the equity ETFs are assessed monthly.
Features of Separately Managed Account
- Choose from four professionally constructed portfolios depending on your needs
- All portfolio management is taken care of for you
- Access Rivkin’s systematic strategies that have proven themselves in live trading in our retail advice product
- Obtain institutional brokerage rates that are not typically available to individual investors
- Execution is performed using algorithms that spread trading out across the day to obtain a fair price
- No upfront cost – management fees are deducted from your account on a monthly basis
For a complete list of risks and costs involved with Apex Separately Managed Accounts please refer to the Product Disclosure Statement. This PDS has been prepared and issued by The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235150)
Please click here or request the PDS to understand the full risks and cost of the product before making a decision to invest in it.
Important Notice: Please consider your own financial situation before investing in our products. Rivkin does not provide personal financial advice and does not take anyone’s personal financial situation into account when structuring its model portfolios.
Past performance and/or backtesting is not a guarantee of future performance. Investing and trading carry financial risk, when judging performance please consider the different types of investments and levels of risk associated.
To learn more about how we calculate performance click here.
This PDS has been prepared and issued by The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235150) as the responsible entity and the issuer of units in the Apex Separately Managed Account. It is general information only and is not intended to provide you with financial advice, and has been prepared without taking into account your objectives, financial situation or needs. You should consider the product disclosure statement, available on www.rivkin.com.au, prior to making any investment decisions. If you require financial advice that takes into account your personal objectives, financial situation or needs, you should consult your licensed or authorised financial adviser. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information.
All opinions and estimates constitute judgments of Rivkin and are subject to change without notice. These statements should therefore not be relied upon as an accurate representation or prediction as to any future matters. No company in the Perpetual Group (Perpetual Limited ABN 86 000 431 827 and its subsidiaries) guarantees the performance of any fund or the return of an investor’s capital. Past performance is not indicative of future performance.
PERPETUAL BEING THE ISSUER AND RESPONSIBLE ENTITY UNDER The Trust Company (RE Services) Limited (Perpetual, Responsible Entity, RE, we, us or our), part of the Perpetual Group ABN 45 003 278 831 AFSL No 235150
